Real-Business-Cycle Theory Suggests That Changes in

question 21

Multiple Choice

Real-business-cycle theory suggests that changes in

• A)monetary policy are the single most important cause of macroeconomic instability.
• B)investment spending will have a direct and significant effect on aggregate demand.
• C)technology and resources affect productivity, and thus the long-run growth of aggregate supply.
• D)the velocity of money is gradual and predictable, and thus is able to accommodate the long-run changes in nominal GDP.

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Definitions:

Group Dynamics

The psychological processes involving interactions, behaviors, attitudes, and roles that occur within a group setting.

Synergy

The creation of a whole greater than the sum of its individual parts.

Cohesiveness

The degree to which members are attracted to and motivated to remain part of a team.

Quality Circle

A group of employees who periodically meet to discuss ways of improving work quality.